But What?

Unlocking the Potential of ROI:

“I have a great used car manager, but I can’t get him to understand why ROI is important.”

Recognizing the value of ROI is crucial in maximizing profits. There’s a lot of money at risk. We must get a return on our investment.

Bridging the Gap in Understanding:

“Sam is a really smart guy, but he just won’t get with the program.”

Intelligence is an asset, but without alignment with the overarching goals, it’s kind of a wash. Ensuring everyone is on the same page fosters a harmonious and efficient work environment with everyone being on the same page.

Turning Auction Challenges into Opportunities:

“Dave is a great buyer, but we never make money on the cars he buys at the auction.”

A skilled buyer is an asset, yet turning auction acquisitions into profit vehicles involves strategic decision-making and the shortening of the life-cycle of these always problematic units.

Balancing Intelligence and Practicality:

“Smart guy, but no common sense.”

Intelligence alone is insufficient; marrying it with solid common sense ensures a better end result.

Optimizing Inventory Management:

“Marsha is a great used car manager, but we have a lot of stuff over 60-days old.”

Efficient inventory turnover is a key metric. Addressing aged units requires proactive measures and strategic adjustments to the sales approach. There’s no excuse for a 60 day old unit.

Overcoming Space Constraints:

“I know we need more technicians, but we don’t have enough space.”

While space constraints may pose challenges, finding innovative solutions or optimizing existing resources can often provide a way forward.

Aligning Pricing Strategies with Market Dynamics:

“My used car manager is really smart, but won’t price our cars to market.”

Acknowledging market dynamics and adjusting pricing strategies accordingly is essential for staying competitive and maintaining profitability. When you combine data and common sense, you win.

That’s all I’m gonna say, Tommy Gibbs

Attack The Top Ten

Attack your 10 most expensive units every day.

How simple is that?

Require the used car manager to print out the 10 most expensive units each day. Distribute a copy to all the members of your management team including BDC, Internet, F&I, Desk Manager, GSM, GM, Prep Manager and Service Director.

Everybody must be on the same page with a sense of urgency on these units. With a few exceptions, these units don’t make the kind of money they ought to make based on the amount you have invested in them. You will often find they are the very units that are starting to age on you and the ones you end up giving away at the end of their lifecycle.

They are competing with your new car business and there are fewer butts that can fit in the seats. The longer they sit, the uglier your grosses are going to be.

Three bullet points:

1. There should be a clear understanding with your Service Director that if for any reason one of these cars or trucks is sitting in the service department, they must get it out of there in a hurry because it’s one of your ten most expensive units.

2. Throw your normal retail pricing scheme out the window on these cars. You should price these 10 cars to the public at a bargain-basement price. The sooner they go away the better. There’s only one exception to this approach-don’t do it on any of the 10 cars you always do well with. Use some common sense.

3. Consider putting a bonus on these cars regardless of the number of days they have been in stock. (Not all, but some.)

Historically, here’s what happens. We have a car in inventory that’s around 60 days old. We are more than happy to sell it for what we have in it or less, and we are more than happy to pay a $500 bonus on it to make it go away.

If this becomes a habit for you, eventually your salesman’s compensation percentage gets out of whack to the tune of 22, 25, 28, even 30 percent.

After all is said and done, and when the packs and all the crap shake out, most dealers are looking to get to 17 percent to 20 percent in salesman’s comp.

The point is you are far better off paying bonus money on these units sooner rather than later, regardless of the number of days they have been in stock. It will help you move the unit and avoid sales compensation creep.

The keys to remember:

1. Create a sense of urgency on these units.

2. Make these units go away faster.

3. Make what you can and run.

4. Put some bonus money on the most problematic ones.

Be an attacker. That’s all I’m gonna say, Tommy Gibbs

Things We Say Make a Difference

1. I need your help.

2. What can I do to make your job easier?

3. What do you think?

4. We can fix this!

5. How are you? (And mean it.)

6. Let’s get our heads together!

7. I trust your good judgment.

8. You’re the best!

9. Let’s make something happen!

10. You rock!

11. It’s not a problem, it’s an opportunity.

12. Gimme a high five!

13. Tell me about yourself.

14. You’re amazing

15. Love ‘ya.

Have you got a key word or two? Come on, share it with me…

That’s all I’m gonna say, Tommy Gibbs

Are You Proud of Your Numbers

Even if you don’t have your final statement, you should have a pretty good idea of what the final the numbers are going to look like.

So, rock star, how do they look? I’m thinking you’ve had one of three reactions to your numbers:

1. They look great. Could have even been better, but a little pat on the back is in order.

2. They are ok. Kind of pleased, but you know you could have done a lot better.

3. Not happy at all. What a wasted year. You are super disappointed and know you have to do better.

While you have that statement out, take a look and see if you have any used units over 60 days old. Even one is too many.

That being said, the odds are pretty good that you’ve not made as much money as you think you have, and if by some chance you lost money for the year, you’ve lost a lot more than you thought you did.

I hope the reasons are obvious, but if they aren’t, let me enlighten you a bit.

If you had to liquidate your used car inventory today, your bottom line would take a real hit. The fake news is you think you’ve made money. The real news is you haven’t made any, or at least not as much as you thought.

If you’re the owner or GM, keep in mind someone’s paycheck has been impacted in a positive way from that stuff that’s been sitting. The company’s paycheck, not so much.

A simple New Year’s resolution for you is to fix it. Fixing it doesn’t mean dumping stuff at 60 days old. Fixing it is understanding there’s a retail buyer out there at some number. Retailing early at some price is far better than dumping or retailing late.

I’ve been doing this a long time and for the life of me, I don’t understand the mindset of keeping aged inventory. I’m sure you have a great excuse for doing so.

Keep in mind, there’s not a unit in your aged inventory that you couldn’t have already retailed at some number. Think retail, retail, retail.

The choices you have are to keep on doing what you’re doing or do something that will dramatically improve what you’re looking at this time next year. Enjoy your numbers.

And never forget, having aged used cars is just stupid. That’s all I’m gonna say, Tommy Gibbs

Are You Causing People To Lie To You?

I’m betting you’ve either got a lot of numbers already laid out on a spreadsheet for 2024 or you’re scrambling to get it done in the next few days.

I’m a big proponent of forecasting. It lays out a map as to where we are going. Although there are detours along the way it gives us a chance to get to our final destination.

I’m an even bigger proponent of department head meetings. I believe your job as a leader should be to teach, educate, coach and encourage your team to seek ways to improve your operations.

I tend to take a common-sense approach to most things in life and I approach forecasting and monthly management meetings no differently.

Dealers, or any business for that matter, tend to forecast based on what they would like to do in the upcoming year.

Often it’s based on statements such as “we need to increase our sales by 10%” and/or “we need to reduce expenses by 15%.”

Saying you want to increase your business by 10% sounds good, but if you don’t have a plan to get there what good is it?

I’ve always been baffled by annual forecasting.

One of two things usually happens:

1. Someone is overly optimistic and/or they are blowing smoke up someone’s butt.

2. Someone serves up a low ball because they don’t want the pressure of hitting an unrealistic number.

Although dealers want to see an improvement in the next year’s numbers, what they really want is a number they can take to the bank.

In order to do a realistic forecast, you have to take into account staffing, inventory, and market conditions. How can anyone do a forecast and predict what those three pieces of the equation are going to look like 3, 6 or 12 months down the road?

I’m not saying you shouldn’t do an annual forecast, but doesn’t it make more sense to adjust that forecast monthly or quarterly based on those three fundamental elements?

Because most leaders don’t make those adjustments it frustrates the management team and defeats whatever good intentions there might have been. Everyone eventually loses respect and confidence in any type of forecasting and concludes “Why bother?”

While it makes good sense to do a monthly or quarterly review of the actual numbers, managers become disillusioned with these reviews in that they become a “beat up” session rather than trying to figure out what went wrong and how “we” can fix it.

People know when they didn’t perform. What they want from upper management is leadership that gives well-defined ideas and direction on how to “fix it” or make it better.

Using more common sense with your forecasting and monthly management meetings will help you grow a solid organization that generates consistent profits and sustained growth.



That’s all I’m gonna say, Tommy Gibbs

Are You Dumb?

“You’re never as smart as you think you are, and you are never as dumb as you appear.” Some of you are feeling smart right now. You’ve had a few good years and there’s been a little chest-pounding going on.

It could be that you are smart, or it could be that you got lucky because of a once-in-a-lifetime market shift in your favor.

And of course, there are times when you feel dumb. Maybe you are or maybe you aren’t. You might be a victim of a bad set of circumstances. Some of you have had bad franchises in bad locations or it could be that you’re a newer used car manager that inherited a hot mess for a used car inventory.

Or it could be you’re just dumb.

In any given set of circumstances, it’s important to maximize whatever you have. If you have half a brain you must ask yourself, “Did you maximize your potential the last few years?”

Sure, you had record profits, but how much did you leave on the table?

Did you do a lot of things right or did you just get lucky?

With grosses starting to slide, a lot of dealers are starting to question themselves as to where the market is going and what approach they should take moving forward.

The most important thing right now is recognizing where you are, how you got there, and how to keep the train on the tracks.

This business continues to be:

All about the basics.

All about the fundamentals.

All about your disciplines.

All about the processes.

All about understanding the data.

All about common sense.

All about your focus.

“You have brains in your head. You have feet in your shoes. You can steer yourself any direction you choose.”

That’s all that Dr. Seuss and I are gonna say, Tommy Gibbs

Are You Dumb?

“You’re never as smart as you think you are, and you are never as dumb as you appear.” Some of you are feeling smart right now. You’ve had a few good years and there’s been a little chest-pounding going on.

It could be that you are smart, or it could be that you got lucky because of a once-in-a-lifetime market shift in your favor.

And of course, there are times when you feel dumb. Maybe you are or maybe you aren’t. You might be a victim of a bad set of circumstances. Some of you have had bad franchises in bad locations or it could be that you’re a newer used car manager that inherited a hot mess for a used car inventory.

Or it could be you’re just dumb.

In any given set of circumstances, it’s important to maximize whatever you have. If you have half a brain you must ask yourself, “did you maximize your potential the last few years?”

Sure, you had record profits, but how much did you leave on the table?

Did you do a lot of things right or did you just get lucky?

With grosses starting to slide a lot of dealers are starting to question themselves as to where the market is going and what approach they should take moving forward.

The most important thing right now is recognizing where you are, how you got there, and how to keep the train on the tracks.

This business continues to be:

All about the basics.
All about the fundamentals.
All about your disciplines.
All about the processes.
All about understanding the data.
All about common sense.
All about your focus.

“You have brains in your head. You have feet in your shoes. You can steer yourself any direction you choose.”

That’s all that Dr. Seuss and I are gonna say, Tommy Gibbs

Is Forecasting a Waste of Time?

I’m betting you’ve either got a lot of numbers already laid out on a spreadsheet for 2024 or you’re scrambling to get it done in the next few days.

I’m a big proponent of forecasting. It lays out a map as to where we are going. Although there are detours along the way it gives us a chance to get to our final destination.

I’m an even bigger proponent of department head meetings. I believe your job as a leader should be to teach, educate, coach and encourage your team to seek ways to improve your operations.

I tend to take a common-sense approach to most things in life and I approach forecasting and monthly management meetings no differently.

Dealers, or any business for that matter, tend to forecast based on what they would like to do in the upcoming year.

Often it’s based on statements such as “we need to increase our sales by 10%” and/or “we need to reduce expenses by 15%.”

Saying you want to increase your business by 10% sounds good, but if you don’t have a plan to get there what good is it?

I’ve always been baffled by annual forecasting.

One of two things usually happens:

1. Someone is overly optimistic and/or they are blowing smoke up someone’s butt.

2. Someone serves up a low ball because they don’t want the pressure of hitting an unrealistic number.

Although dealers want to see an improvement in the next year’s numbers, what they really want is a number they can take to the bank.

In order to do a realistic forecast, you have to take into account staffing, inventory, and market conditions. How can anyone do a forecast and predict what those three pieces of the equation are going to look like 3, 6 or 12 months down the road?

I’m not saying you shouldn’t do an annual forecast, but doesn’t it make more sense to adjust that forecast monthly or quarterly based on those three fundamental elements?

Because most leaders don’t make those adjustments it frustrates the management team and defeats whatever good intentions there might have been. Everyone eventually loses respect and confidence in any type of forecasting and concludes “Why bother?”

While it makes good sense to do a monthly or quarterly review of the actual numbers, managers become disillusioned with these reviews in that they become a “beat up” session rather than trying to figure out what went wrong and how “we” can fix it.

People know when they didn’t perform. What they want from upper management is leadership that gives well-defined ideas and direction on how to “fix it” or make it better.

Using more common sense with your forecasting and monthly management meetings will help you grow a solid organization that generates consistent profits and sustained growth.



That’s all I’m gonna say, Tommy Gibbs

What If You Lose Your Head Coach?

The recent suspension of the University of Michigan’s head football coach, Jim Harbaugh, stirred conversations about the impact of losing a key leader.

His offensive coordinator, Sherrone Moore,, stepped up and secured three consecutive victories in his absence.

This prompts me to ask a crucial question – what if you were to lose your head coach even if for just one day?

In the automotive business, your head coach could be likened to your Desk Manager, Sales Manager, GSM, GM, or owner-operator.

The importance of leadership, preparation, and team development cannot be overstated when it comes to maximizing your business on a daily basis.

The success of the University of Michigan’s football team in the absence of their head coach highlights the significance of preparation and team cohesion.

Much like a well-coached football team, a successful dealership should be capable of sustaining momentum even when a key manager is absent.

Michigan’s victories were not a stroke of luck but a testament to the meticulous preparation by the head coach. The coaching staff and players were ready to adapt, showcasing the depth of leadership and the resilience of a well-prepared team.

In the automotive business, when a key manager is out of the store, you will often see sales fall off.

Is there a culture of continuous development and coaching within the organization? Too often, the lack of success in a manager’s absence can be traced back to inadequate leadership rather than the competency of the stand-in.

Their role extends beyond day-to-day operations; they are the architects of a winning team. Effective leaders cultivate a culture of learning, adaptability, and accountability. When a key leader is absent, the dealership should seamlessly transition, drawing strength from the foundation laid by the head coach.

To ensure success in the absence of a key manager, a winning culture must be ingrained in the dealership’s DNA.

If there’s a breakdown in your store when a key player is out, you must ask yourself, is it that your “head coach” is concerned about job security and doesn’t want the assistants to learn but so much, or do you have the wrong assistants on your team?

Keep an eye on your head coach. That’s all I’m gonna say, Tommy

It’s Thanksgiving…Give Thanks And

It’s Thanksgiving and time to give thanks.

If you’re like me for sure you have a lot to be thankful for. Among many things I’m thankful for are your friendship and support.

Thanksgiving also starts the closeout of the year. It centers around Black Friday and rolls through the last week of the year. Like it or not, 2024 is already here.

I’ve listed some very basic ideas you need to take into consideration that will help you finish strong and get ready for your best year ever:

A. Re-commit yourself- and your thinking towards being the very best you can be. Take stock of all those great ideas running around in your head.

Write them down and make a commitment to get them done by certain dates. Post it on the wall in several places that you will see frequently. If you have a private restroom, put it on the mirror.

The dealers and GMs with the most successful used car operations are those who have taken ownership of the used car department.

The more involved you get, the more success your dealership will have. If you’re not committed to the used car business, it’s a safe bet your team isn’t either.

B. Re-evaluate the appearance of your inventory. One of those disciplines might be to do a weekly lot walk. Every car in your inventory must be touched. If it’s in service, touch it. If it’s in prep, touch it. If it’s in the budget center, touch it.

Everybody touches it. Even if you think you have your disciplines well defined inside your head, you’d be well served to make a written list and check them off from time to time.

D. Re-Recon-Take every unit over 30 days old back through a recon process. (You’ve already missed your best window of opportunity to make gross; that would be the first 20 days.)

E. Re-Invest in yourself and your management team. Do something to gain some knowledge. Hire me, visit CarMax, or visit a dealer friend in another state that does a good job in used. Attend a workshop. Join a Twenty Group. Join a Used Car Twenty Group. Do something besides sitting there and waiting for something to happen.

F. Re-think- your management team. Do you have the right person running your used car operation?

Yes, that person may have been with you for years. Loyalty sometimes equals mediocrity. Maybe they have some great skills, but the fact is that you may not be making the best use of their talents. Get them in the right seat on the bus or help them find a different bus.

I’m thankful for lots of things this holiday season and I’m especially thankful that you’ve taken the time to read my little Zingers.

That’s all I’m gonna say, Tommy Gibbs.